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Delicious77
1 month ago
12

The seller was told by the bank that she has a prepayment penalty due at the time of closing. the penalty is 6 months' interest

on the current loan balance. based on 6% interest, her monthly payment is $569.57 principal and interest and her loan balance was $95,000 the month before closing. once she makes her next monthly payment, how much will she owe in prepayment penalty at the time of closing?
Business
1 answer:
soldi70 [3.4K]1 month ago
3 0
Utilizing the compound interest formula:

The annual compound interest equation, including principal amount, is:
A = P (1 + r/n)ⁿˣ

Here:

A = future value = $95000
P = principal investment amount =?
r = annual interest rate = 0.06
n = frequency of compounding per year = 2
x = duration in years for investment = 0.5


95,000 = P (1 + 0.06/2)¹

95,000 = P (1 + 0.03)

95,000 = P (1.03)

P = 95,000 ÷ 1.03

P = 95,000 ÷ 1.03

P = 92,233.01

Total compounded interest = 92,233.01 - 95,000

Total compounded interest = -2,766.99
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